With each day that passes, the Chinese way of life heightens my interest in the country and the way it functions. And my perspective is limited considering myself and my peers have only seen two of the country’s largest cities — Shanghai and Beijing. That’s a small fraction of the massive country and yet, the information we will take back with us to America is so vast and is growing each day.
Today what caught my attention is the way the Chinese value money. In a class discussion with Xu Wu and Andrew Leckey, both journalism professors at the Walter Cronkite School of Journalism and Mass Communication, they explained the difference in the way Chinese and Americans view money.
The first interesting element to consider is the amount of cash the Chinese keep on hand or in a bank account. The idea of saving money resonates more with the Chinese than with Americans, who rely heavily on loans and credit accounts, rather than saving and using their own money. In my opinion, the Chinese just seem to have a greater respect for monetary value.
Wu pointed to a story written last week in China to highlight this point. The story noted that in Beijing alone, there are some 200,000 families with over $2 million U.S. dollars in their bank accounts.
He also noted that in China, the salary of workers only account for about 30 percent of their income, on average. Instead, he said a large part their income is accounted for by bonuses, stipends and the fact that there is no tax in China.
In America, taxes cause the loss of a substantial amount of money on a total paycheck. Leckey noted that Muhammad Ali received only about 30 percent of what he made due to heavy taxes. He added that taxes are such a huge issue in America but in China, they’re virtually not existent.
“Taxes are very capricious from state to state,” he said.
In addition to the information listed above, I also find it interesting that China’s salary is set up in a very unique way in comparison to America. Here workers are paid for 14 months of work in any given year. They are paid a “double salary,” in the last two months of the year and are even given free gifts, like ham for example, on major Chinese holidays.
The notion of a “double salary” in America probably wouldn’t go over too well with many company executives. In China, though, it’s the normal practice.
Wu also noted the difference in the value placed on money between China and America. He said it will be interesting to watch how the American dollar exchanges with the Chinese Yuan in the future.